JPMorgan Chase Loses $2 Billion In Risky Trades
By Jim Zarroli
J.P. Morgan Chase reported $2 billion in losses over the last six weeks, and said there may be more to come. In a news conference shortly after the market closed Thursday, CEO Jamie Dimon said the losses stemmed from a credit default swap that was “poorly executed and poorly monitored.” ZARROLI: The trades took place in a unit of the company that is supposed to manage or hedge risk. But this time, the unit employed an unusually complex strategy that ended up backfiring on the bank. Karen Shaw Petrou is managing partner of Federal Financial Analytics. KAREN SHAW PETROU: Hedging is vital to safe and sound banking. The real question is: Was this a legitimate hedge? That’s the issue.
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